Slide 1: Broker and Institutional Presentation
STRIKE RESOURCES LIMITED Thursday, 7 December 2006 MARKET ANNOUNCEMENT Broker and Institutional Presentation We are please to enclose a copy of a presentation to be made by Managing Director, Mr Shanker Madan and Director, Professor Malcoim Richmond, to various brokers and institutional investors in
Slide 2: Strike Resources Limited
: i ET STRIKE RESOURCES LIMITED vi
Slide 3: Executive Summary
STRIKE RESOURCES Line Peo e The global market for iron Executive Summary Strike has secured rights to a ore is forecast to remain potential 1.2 billion tonne high strong. grade (60%+Fe) iron ore resource. Strike is targeting up to 20Mt Strike has assembled a very per year production by 2011. ap expe
Slide 4: The price of high grade iron ore has risen over 100% during the last 18 months
STRIKE RESOURCES Line Peo The price of high grade iron ore has risen over 100% during the last 18 months e Chinese demand is up threefold during last 5 years. e Tight supply. e Group pricing power (CVRD, BHP & Rio Tinto). 6 Dec 2006 AS 1.00 0.95 0.90 0.85 0.80 0.75 0.70 0.65 0.60 0.55 0.50 0.45 0.40
Slide 5: Outlook for Large Scale Producers
STRIKE RESOURCES Line Peo Outlook for Large Scale Producers e Price drivers > Sustained GDP growth forecast > 8%pa China and 7% India. >» Chinese domestic production comprises ~ 6,000 small mines averaging 60,000 tpa of surprisingly low quality. >» Declining grades of existing large deposits. > Curr
Slide 6: Strike has secured a major interest in two world class high grade iron ore deposits in Peru
STRIKE RESOURCES Line Peo Strike has secured a major interest in two world class high grade iron ore deposits in Peru e Located in Peruvian Andes close to large centres of population and infrastructure. e Resource estimates from previous works conducted by Peruvian Ministry of Energy and Mines (1974
Slide 7: Peru is a very attractive country for mineral exploration and mining
STRIKE RESOURCES Line Peo Peru is a very attractive country for mineral exploration and mining e Peru is among the top five producers in the world of silver (2,921t), zinc (~1.37Mt), gold (173 t), copper (~842,000t), lead (309,000t), and moly (9,500) and is a net exporter of hydrocarbons. e Internat
Slide 8: The deposits lie in the Peruvian Altiplano approximately 30km from the coast
STRIKE RESOURCES Line Peo The deposits lie in the Peruvian Altiplano approximately 430km from the coast STRIKE RESOURCES LIMITED a ‘BERL IRON ORE PROJECTS 5 cs ie 6 Dec 2006
Slide 9: The Apurimac deposits are located near a regional airport
STRIKE RESOURCES Lint Peo The Apurimac deposits are located near a regional airport servicing the major town of Andahuaylas (15km away, population ~250,000) 6 Dec 2006
Slide 10: Resource Estimate Apurimac
STR RESOURCES KE LatE PED tL Resource Estimate Apurimac : 730Mt e Low lying flat tabular ore bodies estimated at up to 260 Mt each. e Mineralisation commences at surface lending to open cut mining with low waste to ore ratio. e Although a mixture of magnetite and hematite it is mostly high grade (+
Slide 11: Drilling and Geophysics at Apurimac looks promising
STRIKE RESOURCES Line Peo Drilling and Geophysics at en Apurimac looks promising ced OPASANT nt ®@ Detailed geophysical work and 31 diamond core holes ( 2,667 m) in 2005: — Resource target 210 -260 Mt (Opaban |). — JORC inferred Resource of 21 Mt 63.1% Fe (Opaban Il). — Mineralisation from surface t
Slide 12: Cuzco deposits are located 80km South of the major city of Cuzco
STRIKE Cuzco deposits are located 80km South of the major city of Cuzco Lee Loe He cena ae A es cae a, a ay i oF : eg 6 Dec 2006
Slide 13: Cuzco resource
STR RESOURCE @ Flat tabular radial bodies within a 4km diameter circular area around an intrusive core. ® Similar to Apurimac. @ Work done to date > Detailed geophysical surveys > Extensive surface sampling 6 Dec 2006
Slide 14: Layout of Cuzco deposit
RESOURCES STRIKE LatE PED tL Layout of Cuzco deposit e Cross section of deposit illustrates low waste to ore ratio for open cut mining. e Resource target between 500 — 650Mt. e Extensive surface sampling shows grades are likely to be ~64%Fe. 6 Dec 2006 a0 STRIKE CUZCO PROJECT SECTION 38000N INDUCED
Slide 15: Strike's Indicative Resource is Significant by World Standards
STRIKE RESOURCES Line Peo Strike’s Indicative Resource is Significant by World Standards Deposit Company Size Grade Fe% Carajas CVRD ~4,300Mt 65% Sishen Kumbha ~2,500Mt 58% Yandicoogina Rio ~1,200Mt 58% Simandou (Guinea) Rio ~1200Mt 64% Christmas / Fortescue (FMG) 350Mt / 59% / 58%? Cloud Break ~2,0
Slide 16: Recent international iron ore transactions
STR RESOURCES KE LatE PED tL Recent international iron ore transactions e Belinga deposit in Gabon > Deposit size: 500Mt. > Grade: + 60% Fe. > Location: 500km from Atlantic coast. > Investment: US$3 billion. > Parties: Consortium including Export-Import Bank of China and China National Machinery and
Slide 17: Strike's Peru assets are held in Apurimac Ferrum
STRIKE RESOURCES Line Peo Strike’s Peru assets are held in Apurimac Ferrum (AF). @ Strike has operational and board control of AF from outset. ® Strike invests $6.5M over 5 years to earn 12.5% of (AF): > $1.5M within 12 months (2.7%) > $5M over following 4 years (12.5%) > Payment schedule can be acc
Slide 18: Strike's 12 month Work Programme
STR RESOURCES KE LatE PED tL Strike’s 12 month Work Programme e $7 million budgeted for 2007. e 17,000 metres drilling scheduled across Apurimac and Cuzco deposits. e Metallurgical Studies. e Marketing. e Pre-feasibility studies for: >» Transport options: - slurry pipeline. - railroad. > Port expans
Slide 19: Metallurgy appears favourable
STR RESOURCES KE LatE PED I Metallurgy appears favourable @ Preliminary drilling shows: > Natural lump is likely to be high grade (+60% Fe) and of Direct Shipping quality. >» Natural fines may be easily beneficiated to high grade (+60% Fe) Direct Shipping fines as high grade sinter feed. e Further d
Slide 20: Transportation studies previously conducted
STR RESOURCES KE LatE PED tL Transportation studies previously conducted e Extensive studies previously undertaken by Takahashi Trading (1961) and Wright Engineers (1970) on the viability of rail and slurry pipeline options to the coast showed both options to be feasible. e Potential to upgrade exis
Slide 21: Production Profile - Slurry Pipeline
STR RESOURCES KE LatE PED tL Production Profile — Slurry Pipeline ~400km to port facility. Significant water and gas available. Downhill gradient. Targeted throughput: 20 Mt pa. Proven technology. >» Bailadila (India) — 7 Mt pa, ~270km >» Samarco (Brazil) — 18 Mt pa, ~350km @ Capital costs ~ US$350m
Slide 22: Production Profile - Rail
STR RESOURCES KE LatE PED I Production Profile —- Rail ® Existing railway Cuzco to the coast could be upgraded to carry 10 — 15 Mt pa. ®@ Capital costs ~ US$700M + @® Low operating costs. But: @ Potential delays in sourcing rolling stock. 6 Dec 2006
Slide 23: Strike has an uncommonly experienced board
STRIKE RESOURCES Line Peo Strike has an uncommonly experienced board @ John Stephenson — Chairman >» Exploration Director Rio Tinto Australasia. > 35+ years managing exploration. e Shanker Madan (MD) > BHP, Rio Tinto, Hamersley Iron. > 30+ years iron ore experience. @ Malcolm Richmond >» Managing Di
Slide 24: Marketing
STRIKE RESOURCES Line Peo Aarketing e China Desk established to develop early relationships with potential buyers in China. e Managed by an experienced iron ore marketing specialist (ex Rio Tinto). e Visit to 7 Chinese steel mills booked for January 2007. e Ore quality has the potential to offer sig
Slide 25: Strike is outstanding value
STR RESOURCES KE LatE PED tL Strike is outstanding value Company Proposed Share MC Adjust Attribut. Fe% Attrib. Adj MC Production Issue* ($M) Mc Resource. / fron f firon Profile Inventory Inventory (A$ per (Mt) (Mp tonne) Aztec Resources Ltd (AZR) 4Mtpa 41062 249.7 219.90 53.0 64% 33.9 6.5 Gindalbie
Slide 26: Strike Capital Structure
STRIKE RESOURCES Line Peo Strike Capital Structure @ $11.5 mcash and liquid assets — sufficient for next 12 — 18 months. ® Issued capital: >» 58.4 million ordinary shares > 20.8 million 20c options (2008) > 1.8 million 20c options (2011) [Hume Mining NL] >» 1.7 million 30c options (2011) [Hume Minin
Slide 27: Summary
STRIKE RESOURCES Line Peo Summary Strike has secured rights to a e This is an asset potentially potential 1.2 billion tonne high = worth many billions of grade (60%+Fe) iron ore dollars. resource. Strike has assembled a very e Strike has the people to take experienced iron ore project — this resourc
Slide 28: Competent Person statement
STR RESOURCES The information in this presentation that relates fo exploration results has been compiled by Mr Hem Shanker Madan who is a Member of The Australian institute of Mining and Metallurgy. Mr Madan is the Managing Director of Strike Resources Limited. Mr Madan has in excess of 5 years expe